Anthony here with your daily market update and analysis for Monday, January 25.
Prices sold off a bit on Friday on the back of an unexpected build in inventory.
Of course, a major factor in the inventory build and decreased demand is China, which is implementing strict lockdowns again in the wake of rising COVID infections.
Here’s my technical outlook for the week ahead:
The direction of the March WTI crude oil market for the week ending January 29 will be determined by traders’ reactions to the $53.94 price area.
Taking out the $53.94 price area to the upside will indicate the presence of strong buyers, while a failure to recapture this level will indicate the buying is getting weaker and, perhaps, the selling is even getting stronger.
Bullish Scenario: A sustained move over $53.94 will signal the presence of strong buyers.
If this move creates enough upside momentum then look for the rally to possibly extend towards the $57.41 price area over the near-term.
Bearish Scenario: Continued weakness under $53.94 will indicate the presence of sellers remaining in control.
If this move creates enough downside momentum then look for the possible start of a short-term correction into $46.05 to $44.47 price area(s).